Labour market support systems need to adapt to better support the growing numberof workers in vulnerable employment

In the UK, much concern about the changing labour market has been framed in terms ofthe shift in risk that has occurred between employers and individuals. The gig economyis often used to epitomize the imbalance in power between those controlling thetechnology, and those carrying out the tasks. This risk shift reaches far beyond Uberdrivers and millennials on bicycles. It can be seen in the use of contracted, agency andtemporary staff and in the unpredictability of zero and minimum hours contracts ofthose working for supermarkets, in warehouses, in social care and in universities.

The impact of this on people’s lives is exacerbated by a parallel transfer of risk in thesystems set up to support those who are unemployed or in low paid work. At the sametime as work has become less predictable, the safety net has become less springy andwith bigger holes.

This shift can be seen in cuts to social security, in the changes and increasingconditionality that Universal Credit brings, in the way jobs are measured and impact onpoverty is not. It is seen in adult learning and the introduction of Adult Learner Loans. Itis seen in a childcare sector that does not have the capacity to offer care to those withunpredictable or non-standard hours, even though those are the jobs increasingly likelyto be available for those on low pay.

The composition of those in poverty in the UK is changing, and increasingly people inpoverty are to be found in working households. Both real wages and living standardsare predicted to fall over the next few years in a way that is highly regressive, as pricesrise and employers are unable or unwilling to offer higher pay. Getting people into workhas been the biggest anti-poverty policy of recent decades, but this (movement out ofpoverty) has not been the metric by which programmes and policies have been judged.The UK’s new metro-mayors offer the opportunity for a redesign of interventions, butwill require bolder demands for control of funding, and measurement mechanisms fromthe mayors themselves.

Lack of pay progression is a significant issue for adults in low-paid work. The evidenceshows the most effective way to increase earnings is to move jobs. However, this bringsrisks for the individual and so requires them to have confidence in the social securitysafety net. This confidence is eroded by increasing conditionality, logisticaladministrative lags, asymmetric information and the lack of honest discussion about theimpact of low pay and insecurity at the bottom end of the labour market.

This is compounded by changes to access to training. Employers are most likely to investin training their higher paid, (and already high-qualified staff). People in low wage jobs,wanting to improve their skills in order to support progression are now expected to takeout Advanced Learner Loans to fund their own training. This ‘risk swap’ combined withsignificant cuts to the Further Education budget and poor information from learninginstitutions on the financial and labour market returns to the courses they offer, hasseen a fall in the number of adults accessing training.

The Work and Pensions Committee have been examining self-employment and the gigeconomy. They have noted the gap between Jobcentre Plus provision, Universal Creditand self-employed claimants. Provision of support for all claimants (both in and out ofwork) needs to be reviewed in the context of labour market changes. This needs to takeaccount of how jobs are measured, access and information about adult learning, as wellhow technology enables support to be delivered differently. In France, Macron’semployment programme addresses the social cost of precarious jobs by proposingemployers using casual workforces bear a financial cost. The incentives in the UK run inthe opposite direction.

There is scope, in better delivery of work support, to challenge the atomisation andisolation of workers and the loss of social capital and networks of new working models.The precarity of insecure work needs to be addressed, rather than exacerbated, by thesystems set up to support people through their working lives. In roles where workinghours are flexible or unpredictable, the division between private and public lives can becomplex. The interaction between the individual and the state needs to understand thatcomplexity and support people to navigate through their working lives rather thanleaving them without compass or adequate map.